ITV’s Robert Peston warns coronavirus FTSE market chaos to ‘be as bad as 2008 crash’ | UK | News

The FTSE 100 Index plunged more than 200 points lower – down around 3.3 percent – after an older patient became the first person in the UK to die after being diagnosed with coronavirus. It was also a sea of red across Europe as the Cac 40 tumbled nearly 4 percent and Germany Dax was 3.5 percent lower, which followed heavy overnight stock market falls on Wall Street in America and across Asia. ITV’s political editor Robert Peston warned the fall is comparable to the 2008 market crash.

Speaking to ITV news, Mr Peston said: “In terms of the first round shock, I do think that could be as big if not bigger than the 2008 recession.

“There were big uncertainties back in 2007. They were largely about the scale of the losses that banks would incur due to their reckless lending which we didn’t really get a handle on until the end of 2008.

“There’s a massive uncertainty this time around where, how many people are going to get sick?

“How many people are going to have to stay off work?

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“How many businesses are going to have to close down partially or completely?

“How much is this all going to cost the Government in terms of bailouts?

“That kind of combination of shocks to the supply side of the economy but also to demand could, in my view, be bigger than that immediate first round shock.

“One of the things that is interesting is that lots of economists and big money managers think once we’re through that terrible shock, next year we could bounce back very rapidly.

The falls yesterday follow a 110-point drop on the top-flight share index in London on Thursday, which brought to a halt a three-day bounceback among UK equities as officials said Britain is edging towards a widescale coronavirus outbreak.

Global markets have resumed their coronavirus sell-off as panic over the unstoppable spread of the outbreak sent stocks tumbling into the red.

Connor Campbell, financial analyst at Spreadex, said: “With no signs of the outbreak slowing down… investors remain gripped with a near unshakeable panic, the week’s various central bank rate cuts only serving to reinforce the seriousness of the situation.”

Russ Mould, investment director at AJ Bell, added that investors are fretting about the possibility of a global recession caused by coronavirus.

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